Madras High Court
Mayavaram Financial Chit Corporation ... vs Deputy Registrar Of Chits on 5 November, 1999
Equivalent citations: [2000]100COMPCAS366(MAD)
JUDGMENT K. Govindarajan, J.
1. The petitioner-chit Corporation is carrying on business in chits having its registered office at Mayiladuthurai, and branch offices at so many places including at Thanjavur. At the instance of the subscribers for change of place of auction from Mayiladuthurai to the places where they are residing or carry on business, the agreement already entered into as contemplated under Section 6 of the Chit Funds Act, 1982, was altered with the consent in writing of the foreman and the subscribers to the chit with respect to chit No. 58 of 1997 after making such alteration in the chit agreement. The petitioner, with a view to comply with rule 14 of the Chit Funds Rules, sent an application to register the said alteration, to the respondent Deputy Registrar. The respondent has sought for opinion from the Registrar in his proceedings dated June 9,1997. The District Registrar, Mayiladuthurai, in the proceedings dated November 4, 1997, informing the respondent Deputy Registrar that the request of the petitioner to alter the place of auction is contrary to Section 19(1) and (2) of the said Act and so it has to be registered only with the Joint Registrar who is having jurisdiction to the said place. The same has been communicated to the petitioner by the respondent Joint Registrar, Mayiladuthurai. Aggrieved by that order, the petitioner has filed the above writ petition.
2. The petitioner has commenced the chit after complying with the requirements under Section 4 of the said Act. The chit agreement also has been entered into between the petitioner and the subscribers in the form as prescribed under Section 6 of the said Act. The same was also filed with the District Registrar, Mayiladuthurai, as contemplated under Section 7 of the said Act.
3. In view of the difficulties expressed by the subscribers, the petitioner has altered the chit agreement only with respect to the place of auction. Such alteration is permissible under Section 15 of the said Act, But the only dispute in this case is whether such alteration is permissible by locating the place of auction beyond the jurisdiction of the District Registrar with whom the said chit agreements have been registered. In this case, the chit agreements have been registered with the District Registrar, Mayiladuthurai. Now the petitioner wants to alter the place of auction from Mayiladuthurai to Thanjavur which place will not come under the jurisdiction of the District Registrar, Mayiladuthurai.
4. From the scheme of the said Act, I am not in a position to see any prohibition to choose a place where the chit firm can conduct the auction. In the impugned order, the respondent has relied on Section 19 of the said Act. Section 19 of the said Act deals with opening of new place of business and getting approval of the Registrar within whose territorial jurisdiction his registered office is situated. Section 19(4) of the Act defines "place of business" which includes any branch office, sub-office or anyplace of business where the chit business may be conducted by such person. Under Section 2(e), "chit business" has been defined as the business of conducting a chit. So the place at which the chit is to be drawn, cannot be described as a chit place of business, and Section 19 of the Act will not stand in the way of the petitioner to request the respondent to register the alteration, as he is not opening a new place of business as stated under Section 19 of the Act. But the petitioner wants to change the place at which the chit is to be drawn, namely, from Mayiladuthurai to Thanjavur.
5. The learned Government advocate appearing for the respondent has submitted that unless all the transactions are being carried on by the petitioner with respect to the said chit registered with the respondent, he/the respondent, cannot have any control over the same. Referring to Section 16(3) of the Act, the learned Government advocate has submitted that if the draw was not conducted on the ground that two subscribers were required to be present at the draw, the Registrar may, on his own motion or on an application made by the foreman or any of the subscribers, direct that the draw shall be conducted in his presence or in the presence of any person deputed by him. On the basis of the said provision, according to the learned Government advocate, unless the draw is conducted within the jurisdiction of the respondent, he cannot enforce the said provision. I am not able to agree with the said contention raised by the learned Government advocate. Except the place of draw, the petitioner has not altered any other Clause in the agreement. Since the agreement has already been registered with the respondent, he has jurisdiction and control with all force with respect to the said chit and he can exercise all his powers given under the provisions of the said Act. It cannot be said that merely because the place of draw is not situated within his jurisdiction, he cannot exercise the powers under Section 16(3) of the Act. Since the said chit is registered within his jurisdiction, he can exercise all the powers including the power contemplated under Section 16(3) of the said Act. Since the petitioner has registered the said chit agreement with the respondent, the petitioner is having an obligation to keep all accounts and other transactions only within the jurisdiction of the respondent so as to enable the respondent to exercise his duties as contemplated under the said Act with respect to the said chit agreements.
6. As stated earlier, I do not find any prohibition under the said Act or the rules prohibiting the petitioner from changing the place of auction even beyond the jurisdiction of the officer with whom the chit agreements have been registered. In the absence of any such prohibition and in the absence of any difficulty for the respondent to discharge his duties with respect to the said chit, the objection raised by the respondent to register the alteration cannot be sustained.
7. In view of the above discussion, the impugned order of the respondent is set aside and the respondent is directed to register the alteration with respect to the place of auction in so far as it relates to the said chit No. 58 of 1997. Accordingly, this writ petition is allowed. No costs.